Minnesota nickel mine brings environmental promise, but also concerns

In an area of high ground amidst the swamps and farmsteads in Aitkin County, about 50 miles west of Duluth, a crew works a rig tipped with a diamond drill bit, boring more than 1,000 feet underground.

The aim is to pull out a 3-foot long bedrock core that engineers will use to help design the mine Talon Metals plans to dig here — deep beneath the surface, a couple of miles outside the tiny town of Tamarack, Minn., population 60.

“So you can think of it like a parking garage at an airport where you’re winding your way up or down,” Talon’s community outreach manager Jessica Johnson said, describing the mine’s design.

“You’d have a tunnel from the surface that’s slanted downward, and you’d be able to wind your way down to that 500- to 2,000-foot depth for the mining to take place.”

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Unlike the Iron Range, where miners have tunneled deep under the earth and dug massive pits to extract iron ore for more than a century, Aitkin County is not traditional mining country. There’s likely not a rock outcropping in any direction for 25 miles.

But geologists with Kennecott, an arm of global mining giant Rio Tinto, began poking around in the early 2000s, after the state of Minnesota paid for some preliminary surveys in the 1970s.

After drilling 42 holes, they hit pay-dirt in 2008. One day they pulled up a core of rock with high grade nickel mineralization.

That “was one of the best days of my life,” said Talon Chief Exploration Officer Brian Goldner from inside the big garage in downtown Tamarack that stores boxes upon boxes of drill core. “You put so much work and so many years into chasing something and then when you actually do find it, it’s just a fantastic feeling. But then the work starts.”

In the years since, Talon, which joined the project in 2014 and now owns a 51 percent stake, has drilled more than 400 exploratory holes to help piece together the size and shape of the mineral deposit deep underground. The company has also drilled groundwater wells and collected extensive baseline hydrological and other environmental data.

All that information will be compiled into an environmental assessment worksheet that Talon is set to submit to the Minnesota Department of Natural Resources any day. It will include details on the mine’s proposed design and how it would mitigate environmental impacts.

That will then kick off a review and permitting process.

If recent proposals for similar mining projects in Minnesota are any guide, that could take years.

But if it passes muster, Talon has ambitious plans to provide the only domestic source of nickel to a supply chain to manufacture batteries for electric vehicles — and help the country make the transition to a carbon-free economy that’s essential to slow global climate change.

The initial life of the mine is an estimated seven to nine years, and it would create an estimated 300 jobs. But the company is drilling more exploratory holes around the clock, with the belief that other rich deposits lie nearby.

“What we’re putting forth is basically the idea that you can extract the necessary ingredients, like nickel, for the energy transition, and protect the environment and cultural resources and create good paying jobs,” said Todd Malan, chief external affairs officer for Talon. “It doesn't have to be a choice.”

But not everyone shares that optimism. Earlier this year the Mille Lacs Band of Ojibwe launched a campaign called Water over Nickel, through which it is asking state and federal officials to prioritize clean water over mining.

“There is much at stake; the proposed mine would be located just 1.3 miles from our communities and has the potential to impact our forever home and critical environmental and cultural resources,” said the Band’s Commissioner of Natural Resources Kelly Applegate. “The Band supports transitioning to a green economy, but in a way that does not cause further harm.”

Talon’s deposit, made up of privately held and state mineral leases, is part of a massive midcontinent rift — what geologist Brian Goldner describes as “essentially the plumbing system of an ancient volcano.”

It’s centered under present-day Lake Superior and includes the Upper Peninsula of Michigan, the site of the only currently operating nickel mine in the U.S., the Eagle Mine. However, that mine is scheduled to close in the next few years.

The rift also includes northeastern Minnesota, where two similar mine proposals that focus predominantly on copper, Twin Metals near Ely and NewRange Copper Nickel on the eastern end of the Iron Range, have so far been blocked by lawsuits and federal action.

Talon’s project raises some of the same environmental concerns as those mines, because the minerals are also encased in sulfide ore.

“When this rock hits air, it turns into sulfuric acid, the same chemical composition as battery acid,” said Applegate. “Can you imagine having a well and you’re drinking groundwater and knowing that this invasive activity is happening that close to your water supply?”

Mille Lacs Chief Executive Melanie Benjamin said the proposed mine is surrounded by valuable water resources — wetlands, groundwater, lakes and rivers — that are put at risk by this kind of mining.

“When we think about that impact of mining, how it could have the potential to hurt our community through many unproven techniques, we cannot be a part of that grand experiment,” Benjamin said. “There is too much at stake.”

Talon says those concerns are a big reason why the company announced plans last year to transport the ore it pulls from deep underground to North Dakota for processing, at an industrial brownfield site in a drier climate, rather than at the mine site. The U.S. Department of Energy has pledged $114 million to help build the plant, which would cover more than a quarter of its cost.

As a result, the mine site in Aitkin County won’t include a large pile of mine tailings, or stores of waste rock, which reduces the potential to generate severe water pollution at the site.

“And we feel that that is a direct response to some of what people have said they are concerned about,” said Malan. “There were groups in the community that were talking about the tailings facility being ‘Mount Talon.’ That's not a concern anymore. Because we’ve made this shift.”

Building the processing plant elsewhere also reduces the size of the surface footprint of the mine. Most of the activity would be underground. Trucks would haul ore to the surface, where it would be loaded on trains to transport to North Dakota.

More details will be included in the EAW, but Talon estimates the mine footprint will occupy fewer than 100 acres. Johnson said the company will have to fill fewer than 30 acres of wetlands.

“All of these things are intended to show that we’ve been listening over the past few years, and we’re doing our best to try and address the concerns of the community and tribal sovereign governments,” Malan said.

Still, by their very nature, mines have significant environmental impacts, regardless of how they're built.

Groups such as the Tamarack Water Alliance, a grassroots group of concerned citizens near the proposed mine site, argue this type of mining has a horrible track record of pollution and leaving governments on the hook for an expensive cleanup tab.

Tom Anderson, who founded the group with his wife, Lynn, lives on Round Lake, about four miles from the proposed mine site, in a restored house that his great-grandfather homesteaded in the late 1800s. The water is crystal-clear, spring fed and so clean, Anderson said, that the lake supports a population of freshwater jellyfish.

“We don’t want to compromise that … with a high-sulfide mine three or four miles away,” Anderson said. “High sulfide and water and air just don’t mix. We don’t want to damage this lake for many, many years to come.”

The Andersons are also concerned about the amount of water that would flow into the underground mine everyday that would need to be pumped out and treated, and about dust from the mine site they worry could be toxic.

“These kinds of mines have a very poor environmental track record,” said Kathryn Hoffman, CEO of the Minnesota Center for Environmental Advocacy. “They have impacts on water quality, as well as quantity, they have climate impacts in Minnesota.”

That’s why Hoffman’s group argues the state should first pursue all other strategies for accessing the metals society needs, before turning to mining.

“We’re putting a billion pounds of metals into our landfills every year. We should be reclaiming those metals, we should be recycling them. All of those strategies are going to be cheaper and faster and cleaner than mining. And mining is a last resort, regardless of how it’s done,” Hoffman said.

Talon agrees recycling should play an important role in generating the metals needed to build electric vehicle batteries. But the company contends there aren’t enough metals available now to create a circular supply chain to meet the Biden administration’s goal of converting half the country’s vehicle fleet to electric in the next decade.

“Right now, the math just doesn’t work,” Malan argued. “We need more nickel. We need more lithium. And the question needs to be ‘How do we do that? Where do we do that?’ As opposed to ‘yes’ or ‘no.’”

Talon’s vision is to produce nickel for a domestic supply chain to make EV batteries. It signed a deal with Tesla to supply the automaker with about 12,000 tons of nickel concentrate annually for six years.

But that’s a fraction of what’s needed. There are at least one dozen battery cell ”gigafactories” planned to be built in the U.S. in the next couple years.

“And the nickel required to make those cells would be between 300,000 and 350,000 tons,” said Adrian Gardner, principal nickel markets analyst for Wood Mackenzie.

So if Talon's proposed mine is built, “it’s still going to be a very small contribution to this long road ahead of electrification,” he said.

Despite the push for electric vehicles, only about 10 percent of new nickel mined worldwide ends up in the battery chain, Gardner said. About two-thirds of it is used to make stainless steel.

“The most attractive route for the U.S. going forward is recycling batteries,” Gardner said, from laptops, phones and eventually from EVs. As battery cell factories begin to come online in the next few years, he said, they generate a large amount of scrap metal during the manufacturing process — scrap that can then be “recycled into the battery supply chain.”

Gardner agrees with Talon that there isn’t enough nickel available now to generate what’s needed through recycling alone. He said the vast majority of new mined nickel will need to come from overseas, from mines in Indonesia, Canada, Australia and elsewhere: “There’s no other way.”

Talon could face a long road ahead as it attempts to do what no other proposed mine for copper, nickel and precious metals has been able to accomplish so far in Minnesota: Get the needed permits to build a mine, acquire the financing and then actually build and operate it.

Environmental review and permitting for the PolyMet project, now called NewRange Copper Nickel, took more than a decade. But the project has since been stalled by litigation, and recently the U.S. Army Corps of Engineers revoked a critical permit the mine needs to move forward.

When the company submits its initial plans, the Minnesota DNR will then determine the issues that need to be addressed in a more robust document called an environmental impact statement. After environmental review, the company then must secure several key permits to build the mine. The entire process could likely take years.

Talon believes its efforts to engage the community up front and change its project based on feedback it received will speed up the review process, and eventually it hopes, win approval. Company officials say they are working hard to counteract the historic distrust many people have with mining.

“We understand that people have concerns and we understand that people are skeptical,” said Malan. But now is the time during the environmental review process, to have that discussion as a society.”